BUENOS AIRES, Oct 24 (Reuters) - Argentina beat its primary fiscal deficit target for the first nine months of 2017 with a gap of 2.2 percent of gross domestic product (GDP), but the financial deficit including interest payments was unchanged as a percentage of GDP, the Treasury Ministry said on Tuesday.

The primary fiscal deficit of 222.379 billion pesos ($12.83 billion) was lower than both the 2.6 percent deficit posted in the same period last year and the Ministry’s target for a 3.2 percent deficit through the first three quarters of this year. The primary fiscal deficit in the month of September was 31.353 billion pesos, 15 percent lower than the same month last year.

The Ministry aims to end the year with a primary fiscal deficit worth 4.2 percent of GDP, although the government’s 2018 budget proposal presented last month anticipated a deficit of 4 percent of GDP this year. The government is aiming to slash the primary deficit to 3.2 percent of GDP in 2018.

Since taking office nearly two years ago, business-friendly President Mauricio Macri has prioritized reducing utilities subsidies to unwind the yawning fiscal gap he inherited after more than a decade of populist rule, though infrastructure and social welfare spending has increased.

His “Let’s Change” coalition’s strong performance in mid-term legislative elections on Sunday will likely boost the prospects for the rest of his reform agenda, including deficit reduction, analysts said.

Despite the reduction in the primary fiscal deficit, the financial deficit - which includes interest payments - remained flat at 3.6 percent of GDP compared with the first nine months of last year. That came as interest payments rose 77 percent to 148.610 billion pesos in the year through September.

The 2018 budget anticipates a financial deficit of 5.5 percent of GDP next year, compared with 6.1 percent in 2017.

$1 = 17.33 Argentine pesos at end of September
Reporting by Maximilian Heath; Writing by Luc Cohen; Editing
by Chizu Nomiyama and Andrea Ricci